tv Fast Money Halftime Report CNBC August 12, 2013 12:00pm-1:01pm EDT
we're watching markets as we have seen slight positive move the dow shedding about 8 or 9 points. we'll see what happens as we move throughout the session. >> it is the summer. that is it for "squawk on the street" on monday as we hit noon time on the east coast and let's get to the fast money halftime report back at hq. have a great afternoon. welcome to the halftime show. four hours to go until the close. take a look where we stand on this monday on the streets. a mixed day, dow is down fractionally as the s&p, nasdaq moves higher. black and blueberry, as the beat down company considers its future, we consider the stock and whether it is dead money or worth a shot. testy over tesla. one wall street firm down grades the hottest stock on the street today and greenberg is all charged up over it. he will take on the traders just ahead. first our top story countdown to the taper, september is just
around the corner and fed is going to pull back on its bond buying this week. could go a long way towards making the central bank pace from retail to housing to inflation to jobs, all of it in focus as the possible pullback gets closer by the day. how do you trade it? with us for the hour, steven weiss, stephanie link, josh brown. >> i don't think you trade it. >> sit on your hands? see if it happens? >> here is what i would say to you. it is very clear that the market's tenor changed a bit. last week approximate in the first week in the last eight weeks we have seen the nasdaq, the dow and the s&p all negative together. my message is that's just fine. there is absolutely nothing wrong with that given the pace we have seen this year of multiple expansion and price. you could expect tremors in the market and clearly this is going
to cause people to rethink a lot of the areas they maybe have been over committed to. i would note you've had huge issuance and success with putting away junk bonds and clearly not something that guys like jeremy stein on the fed want to see, and so do want to tamp down on that and do want to do the september taper, even if it is just a trial balloon, and it is not committed to going forward, you can expect volatility. absolutely nothing wrong with that. look at the positions. you have stuff you're up huge in this year and don't feel like you have to add to it just because the market keeps going up. you can also sell some and take some off. you're not compelled to do anythi anything. >> are you compelled. >> no. >> why not? >> i don't think i have to. the volume really dried up which means the volatility should be increasing and take a look this morning. >> nobody is around. >> nobody is around. they're on the beechl. why not take a break and see
what happens post labor day. that's not usual for august. i am not finding great opportunities. i think they're fairly valued here. overall just wait. take a break. you had a great year so far, take some time off. >> i am obviously the one, very bullish. >> very bullish. >> very bullish and the last couple of days has been a little pressure on the position seeing the pullback in the market. i have not to be anything in terms of taking down the exposure because i think on the other side the end of september i will be okay. i have actually looked at some things and picked up some small positions, cat pit lar, i talked to you about that last week, took a small position in caterpillar and i think it is nothing more than for trade. i thought the chinese excavator figures in july. >> 83? >> 84 and a quarter or some around there. i thought the excavator figures
for july which were up were a little bit better. down year-to-date. i am watching the crop report that came out. i am looking at soybeans and i think potentially you could do stuff given the sharp sell off in the ages over the last week. there is maybe opportunity when you look at the crop report. i think if you focus specifically on what are you seeing in soybeans. >> i think what's pretty clear is that the cyclicals continue to do pretty well. it is not just the industrials and the tech and the financials. now it is the material stocks. we talked about this last week. materials out performed the market at 1% last week and down tape which is pretty interesting. i think what it is telling us is that the growth here is getting better and the growth globally is getting a little bit better in terms of europe. >> i want to ask about that. i heard two schools of thought and i was curious if you weigh in. some people would say that's a sign that the market is more comfortable with global growth going forward, buying into the steel and the iron ore, et cetera. other people would say you know what that is?
it is people looking for and that hasn't moved yet and basic materials one of the only sectors in the s&p and still below the '08 highs and buying the junkie stuff because they need data and badly trailing. what would you say to the latter more bearish skeptical take? >> we talk about this and debate it all the time. are the numbers real in china or not? you're getting better incremental news, the expectations are low and i listen to what the companies have to say, specifically a freeport. both of those reports in earnings were better than the gloom and doom the stocks are discounting. so i think there is a fundamental case if the data continues to be better. it is very important week. we get gdp, eurozone dwchlt dp, industrial production in europe, and we have our own data here. clearly that is very important. it is going to be -- data dependent and we're data
dependent and i think there are some values still in the cyclical stuff. >> you made the case of late certainly that the onus is on the economy at this point to prove the taper should not happen. >> right. >> the rebound here, can i ask a question? when i went on vacation, good news was good news for the market. i was gone last week. was that still the case where data came in better than expected? >> we didn't get a lot of data. >> we didn't and there was the trade data that up lifted gdp. this is the big week. i think i pointed you to a week like this where the july data comes in and consequential for what the fed will do. i want to come back to the deficit. it is more important than you may be thinking about. retail sales is going to be significant. 25% of that report folds into gdp. ppi, cpi, will give the fed
clearance and tell the fed does the fed need to do more or less when it comes to qe and as the week goes on, housing starts, how much of a -- what's the word i am looking for, downside is there going to be to housing from the higher rates here? here is what will happen. the fed if it does nothing will be increasing its stimulus to the economy. why? as the deficit improves the issuance of the treasury will go down or not grow as much and so the fed purchases will end up being a larger share out there. if it tapers and does so by let's say $20 billion 20% that mortgage backed securities, that issuance will go down because re-fis come off because rates are higher that. happens and the fed does the 10 billion, a bigger effect. instead of the 600 pound gorilla, or the 800 pound gorilla in the market.
>> we have the chart. >> if you look at it where it is today, it is somewhere around 5%. >> and walk being forward. >> next year somewhere around 3.5. >> the question is how smart was the street about the deficit? i don't know that the street was ever that concerned with the level of the deficit. what the street was concerned about were things like government shutdowns and defaults because of politics. that was the thing that really spooked the markets. this deficit, i think the street was right to say, you know what, it will be a natural reduction in the deficit just as the economy comes back and the stimulus that was put together in that package came off. >> is it any secret it is working, that this political back and forth heavy infore bid we're seeing the deficit shrink and the economy get by. >> it depends on what you consider to be working. if you consider an an rex i can being on a diet and working, i am sorry for that plapz but
that's the way some people described the notion of cutting the deficit right now. i did work this morning. the last three quarters combined is the biggest government reductions in spending as a percentage of gdp since at least 1980 and probably since the '70s. my data didn't go back that far. we suffered from this. growth suffered from this. >> federal layoffs. >> and a lot of the thinking right now, by the way, also the end of the war in iraq and afghanistan being a big part of that. the thinking right now is that the third quarter can and should be better because some of that reduction and sequester comes off. no problem, i have no problem with reducing government spending. i have a problem with doing it in this automatic way. >> the thinking of our next guest is that stocks will be 100 points lower on the s&p by the end of the year and where they are now. barry nap, live in new york city. welcome back. nice to see you again. >> good afternoon. >> are you looking for 90 points lower by the end of the year on
the s&p from where we sit now. why? >> well, the way we construct any of this price target exercise in futility that is, through the course of the year is the beginning of the year we thought there was a fairly wide range of economic outcomes, but less of a great dispersion as great a dispersion around equity market outcomes and in essence we had 15, 25 price target which was 10% total return in a less than 4% nominal gdp environment. that seemed pretty good. what we think happened which is very pertinent to the conversation you were just having with steve was public policy uncertainty which had such a negative impact on business confidence and business spending in the middle of 2010, in the middle of '11 and in the middle of '12 improved decidedly this year. business investment picked up, capital investment picked up,
and that created what we think will be a faster acceleration in earnings than we anticipated. we thought you would see signs late in 2014. we're seeing signs around mid-2014. that also brings fed policy into play and you know, you go back through fed policy normalizations, 83, 94, 2004, and all the same. irrespective and steve will like this, the pace of policy accommodation removal. alan greenspan speak. in essence the fed was very aggressive in '94 and the point is the stock market always sold off 7.5 to 9.5% with two different legs to that correction. the first one being the intersensitive leg and the second leg being this idea the fed is taking away the punch bowl too soon and that final push is led by financials, discretionary and small caps. >> i keep coming back to the same issue which is that imbalancing as an investor and nominal growth and increase in nominal growth and against the
reduction in fed quantitative easing. i will take the nominal growth every time and if you give me a point on top of nominal growth, 5% gdp, that's nomal before adjusting for inflation and that is far, far more powerful than a 20, a 30, a $40 billion reduction in quantitative easing. >> i would agree from a macroeconomic perspective. no question about that. i wouldn't argue with that. that's at the core of why we increased our earnings estimate for the back half of the year, and a level shift takes up next year, so i don't argue that point at all. what i would say, though, is when you reach the inflection point and that was my point, right, 94 was aggressive rate height cycle and 83 drained liquidity and the fed funds rate drifted up and described to congress they snubbed rates a little and it really didn't matter. reaching that inflection point caused a pullback and it had two
stages. >> we worked together a number of years and i don't remember any point during that time if you weren't even until bernanke recently had such a transparent fed, so couldn't you argue that so much of that move to tighten rates or to take back stimulus is already discounted the market? it is all we talked about every day. we talk about something so often, it is had to have keeped in. it seems to be one of stimulus promoting growth rather than continuing to tighten in europe. shouldn't that help multinational earnings and drive the market higher? >> let me answer the first question first. i have two comments with respect to that. one is in 2004 the fed was actually releasing statements after every meeting, that's the first time they had ever done that. you could argue the relative
transparency of 2004 relative to 94 or 83 was a massive change and we still had a correction that before the tightening, but the stock market didn't bottom until five weeks afterwards. you had a big inflection point then and still it wasn't done. the second point i would make, steve, is that all of those corrections had as i said two stages to it rchgs the interest rate sensitive stage and the stage where the if he had is station away the punch bowl too soon. we haven't completed the process. both of those argue against this being fully discounted in the market. too soon is the operative phrase or not? >> no, no, not at all. i am saying that's the market narrative. >> when you say too soon, you mean it does so in an environment where growth does not support the move by the federal reserve? >> no. what i am arguing, steve, is that the market believes the fed
is doing it too soon, and so you have a correction in the most domestically leveraged cyclical -- >> that's not true. >> ultimately that's not true. >> it will still have the taper tantrum that we're talking about because the punch bowl cannot be removed even if it is only a few glasses worth taking away. >> absolutely. the intermediate term story is the more interesting story quite frankly as much as if you go back in the prior cycles, there is a lot of information develops during those corrections and tells you a lot about the rest of the business cycle. for example, in '94 the tech sector was far and away the best performer through that policy related correction and a real signal about the rest of the business cycle, the same thing happened with energy in '04, so for us we think that's probably things like industrials,
chemicals, some of the benefits of the low cost source of energy and that's what we're looking to which is to some of the points that stephanie made a little bit earlier, what holds up during the stage of the cycle will tell you a lot about what works later on. >> secht jobs report, be all end all, will it come down to that. >> i think if we get better economic growth and other indicators point to that it will be important and not the be all end you will a. >> who could buy blackberry as the company considers putting itself up for sale? we will look at the potential buyers if there are any and social media to the home builders, a look at the top trades in today's session and of course how to play them ahead. hey linda! what are you guys doing? having some fiber! with new phillips' fiber good gummies. they're fruity delicious!
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struggling smartphone maker blackberry exploring strategic alternatives. john joins from us silicon valley with more on this drama that seems to never end, john. >> yeah. they're just in a tough spot. think about it. we're just getting the first whiff of an apple event coming up in less than a month. we expect a new iphone and google just launched the moto x phone a couple weeks ago and we expect hundreds of millions in marketing spending on that over
the past few months and blackberry with the pen devices that haven't been selling well and looking into this tsunami and where is the value here? you have a few pieces. first of all the revenue that blackberry gets, it is probably one of the least valuable pieces of the business because it is basically in decline, market share wise and you also have the network business which is interesting. they're getting less service revenue out of that because they didn't start early enough to think about what kind of services would go with their next generation phones. if somebody is going to swoop in and get value out of this they have to figure out the services component and they have to decide what to do with hardware and figure out what to do with all of these employees who have been hired up in position for some kind of hardware comeback that may or may not be in the cards. >> john, thanks. guys? >> it is a lame pop for a stock of a company that puts itself up for a potential sale or is at
least considering its future. >> when you think about technology companies, it almost never goes william when they float this kind of thing looking for strategic alternatives. you go down the line, palm, three com, dell, skype, you don't get a giant change after they say this. it is usually when there is nothing left to do. >> >> nobody that can afford it wants it. if microsoft wanted it, they would have got it. who are the other buyers? >> ibm, i don't know. >> and i don't want to get into the handset. >> why is it when we have this activism in dell or what we're seeing no one stepped up and said look at blackberry, let's take an active stake. >> it is harder. >> it is harder but it is not --
>> what what would the activists do? >> an activist takes a position. >> we asked multiple times. any interest in blackberry, zero, none. >> what would an activist do? >> i bought some more today, friday, and here is what i see. i see a company have you a smart warren buffett as a shareholder, big shareholder and knows where the value is and you have an enterprise system that hindered sales and the enterprise system security features weren't fully embedded in the system. i have other company that is sold in terms of ways, and google, i believe, or skype and so those 70 million subs will be the new mobile im. >> how about the cash burn rate. >> hold on. cash actually grew last quarter. >> supposed to go down next
year. >> we could have had the same conversation with dell. as a matter of fact, we had the conversation. >> we did. >> when that was half of where it is now. we had the conversations with apple if you go back when it was like a $3 stock when they said they're out of it an not going to do anything in the '90s. the point is skype, nobody thought that value was what it was. there are strategic buyers >> what are you looking for? is it the market telling you the premium is not going to be much by virtue of the lackluster reception this news is getting in the stock? >> this is so beaten down, so hated, that you can't expect people to change their thinking all of a sudden when everybody says nobody will buy it, nobody will buy it. >> last summer into the winter. >> what was that? >> it was the run up --
>> this is a rerun. >> the company saying publicly we're looking to sell. >> let me bring in a guest x max wolf, the senior tech analyst and people talk apple and other things as well. let's get a comment or two here on blackberry. potential suitors, realistically, are who? >> i don't think they'll be here but i think there are potential suitors. i think the enterprise system and the business relationships are valuable and the patents and the security features. if you can't push out your value proposition on e-mail security in the last two weeks with edward snowden, i think it is fair to say you're not the king of messaging. that being said, this could be the important part of the ecosystem and i think we will see the big players follow the consumer focused tech and try to enclose the system.
>> what does it mean for the stock? what kind of price will we be looking at? i have a trader that bought the stock. >> i think are you looking at a premium. i think what are you hoping is a rescue with a discount to whatever you think the sum value is, the best case scenario for somebody speculating on the shares would be some sort of disincident immigration where there is a sell off and aggressive privatization where more kind of players, jv partners emerge and i think it is unlikely. what we're talking about is capturing the underlying value on a go toward basis. >> what's it worth. >> a little less than where it is trading now. i don't really think. >> who want this is? who are the most likely suitors? >> i think mobile with the
secure system and wants to have another way to sell into and dominate their enterprise clients. i think you are looking at things like oracle, possibly although very unlikely salesforce and maybe ibm and somebody that wants to take that space over. i don't think are you looking at the titans and i think it will be more likely to be valuable in parts than as a whole. >> the name lenovo mentioned in the past. obviously there would be concerns on the purchase being made by the chinese. do you think that gets done? >> i think it might get done. the problem is only real iron clad promises to various canadian authorities and that the security loss of being lenovo related wouldn't be devastating and that you wouldn't look at the unfortunate water louvre that may happen to the rejobl economy around us. it may not mean much to us. if you're sitting in a certain part of canada or the canadian government you may look at the risk a little differently as we would as analysts in the private sector. >> a last comment from you.
in a great respect, blackberry's pain has come as apple and the iphone gained. what is your read in on this new device we think is coming on september 10th? what is it going to have? what is it going to mean? >> sort of chatter about possibly three devices, new generation ipad and then a baseline cheaper iphone as well as new iphone, let's call it the 5s just to be uncreative like most of the rumor mill was. i think ios 7 is the bigger story. i think it is going to signal apple being innovative again. i think it will change the looks and i think apple at least temporarily regains some of its mojo. that beinged, the long-term trends and risk from new emerging operating systems from google aren't going anywhere and will continue to be an issue for the foreseeable future. >> thanks for coming on. good to talk to you. max wolf. let's get a comment about apple. we exhausted blackberry. is it going be to meaningful as
a share hold zero depends on futures. >> fingerprint log on and passwords, just not going to do it. bloomburg had the technology awhile ago. >> what about colors? >> speaking of gold, gold is having the best gain in three weeks. we head to the pits to tell you how to you play it and with facebook shares above $38 a share, one big name insider is unloading a very big stake. is this a warning sign for investors? stick around. we're coming back. [ kitt ] you know what's impressive? a talking car. but i'll tell you what impresses me. a talking train. this ge locomotive can tell you exactly where it is, what it's carrying, while using less fuel. delivering whatever the world needs, when it needs it.
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to that actually coming to fruition. he has put out as i said icahn put out a press release saying we encourage investors, the media and others interested in our company to review the information that he posts on twitter in addition to the information that we disclose using our investors relations website. i can also tell you from sources that i think we're talking a matter of days when we find out what carl icahn is up to next. the dell saga is on going. there is that court proceeding down in delaware today, and he is just crushed it with herbal life as you all know. he crushed it with netflix as you all know among other things with a good year and, joe, the company was out with earnings last week. >> increased the dividend. >> and you have been following this. >> solid. it is a company trading at $40 and set up is mlp and revenues came in strong, 4.6 billion,
when you look at where they are now, clearly having a strong year. stock is up at 90 a couple of months ago and trading around 75 here. i think what you saw in last week's earnings will stabilize a consolidation pullback. i like the stock. >> again, we're showing the twitter handle down here. short of trying to be more active on twitter, just like a lot of other people are, warren buffett, et cetera. so it is my understanding from a source that in a matter of days we may find out what the next big position is. when we find out, we'll tell you if you don't find out on twitter. gold glitters today rising 2% to hit a two-week high. more from jackie deangeles. >> good afternoon. that's right, scott. this we're seeing action in gold today as the dollar rises which is usually bad for gold. anthony, you're at the nymex. what is behind it today? what are traders saying? >> technically above the 58 moving average that came in around 1309 and the dollar weaker lately although not today
and on the fundamental side of the market strong demand in asia and the commitment of traders report first time i saw it all year, were the longs in gold actually almost matched the shorts. no other metal has that right now. there is way many more shorts in silver, platinum, things like that and a lot of shorts bailed in gold right now. >> jim, right near 1350. did break through that 50-day moving average. at this point if we get through 1350 are we off to the races or still trading in a range here? >> i think we're close to breaking out of the range. 13.50 is the upper end of that. for me to say that's our objective now, no great shakes but if he can get above there and consolidate for a while and a couple days, i think we're off to 1400 and i think they changed despite the movement. both the yen and the euro rallied hard in the last months. that coincides with gold and pushing higher. despite the fact it is stronger today, i think it is a currency plight. >> off to 1400.
haven't heard that in awhile. my thanks to jim and grizz. check out our website. scott. >> are you the one that is had mark faber on last week. >> we did. mark came out and said that he thought the s&p was going to go down about 20% and he also was saying that it was time to hold coal. >> which has gotten a ridiculously high number of views i am told. >> it did. >> keep it up. >> we'll see you at one. >> i told you last week i think price of gold will drop 20% for the end of the year. some of the things i am seeing within the technicals of the fundamentals i want to walk that back and that's for the remainder of the year i take neutral stance. i know steven does not believe in the chinese numbers and a lot of the numbers that i don't believe as well. unfortunately that's all we have for the street. demand for gold coming out of china, the latest figures, in particular gold bars up 87% and looks like china is back again. i am not telling you to buy but i want to walk back. >> was gold's demise greatly
exaggerated or what? >> no. gold came down dramatically because of what got into the bubble territory and everybody is picking. >> are we going to slowly work our way back? >> i don't see the investment case for gold. i never have. i missed it on the way up. you just can't value it. i get what joe is saying. to me it is indication china is in more trouble, not less trouble. >> if i may, also keep in mind gold miners are part of this whole cohort basic materials rallying. maybe let's not make it more than what it is which is a bounce from deeply over sold territory with this sector, the s&p sector in its entirety is moving. coal miners -- >> they go on vacation, too. >> shorts like the beach, too. >> exactly. >> up next, priceline shares about to become the first ever $1,000 stock in the s&p.
is that going to happen? is it justified or a classic sell signal? we'll debate that after the break. later, is tesla stock about to crash? the shares getting hit after a big downgrade and the questions elon musk's ability to execute. herb is fired up on this one. he is going to tell us why after the break. this man is about to be the millionth customer. would you mind if i go ahead of you? instead we had someone go ahead of him and win fifty thousand dollars.
you might just call it the hottest ticket in town after rallying 55% this year, priceline is sitting at about $960 a share. is this stock really worth the price tag? we debate it now. steve weiss, the bull and josh brown the bear. 90 seconds on the clock. mr. bull, make your case. >> i don't look at the actual dollar amount. i was amazed over the last few years the stock didn't really get crushed and that fundamentals didn't get crushed
because 80% of their business is outside the u.s. so with 295,000 hotels and accommodations that basically have such a leading market share, very, very tough. if you go out a few years, maybe they make that impact and maybe apple makes an impact. >> i agree it is a great company. if this is the type of name you want to bet against, you can't buy this stock here. it is a 20% grower, maybe 25 if you are luck and i not 30 on a go-forward basis. i have to tell you something. it is trading at 20 times earnings. it is reasonably priced, actually a 15% premium to its historical price to earnings multiple and and evaluation basis a little stretched. >> i got s&p and no growth. >> and we have had based on historical numbers.
>> it would be great to go to kayak. that would help. >> kayak is in its own world. booking.com in its own world. >> price doesn't matter because they get a commission. price can go up. i like it. it owns the market in europe. europe is getting better. not worse. >> stephanie, who made the more compelling argument on priceline? >> i think both actually is the winner and i think the 38% is the figure you want to look at. >> 39% on the quarter before. >> you're comparing 20 and 25% earnings growth and i am looking at bookings growth and that's visibility and 19 times forward estimates. in addition you have margin expansionnd the way gain in market share. i think all of these things collects actively make sense to stay with the stock. i don't know if i would buy a new position here. i would stay with it. >> tell us who you think won the debate. tweet us and use the hashtag bull or bear.
>> stephanie should have been sitting here. she did a better job. >> she usually does. >> we're going to give you the results of who you think won at the end of the show. it is a story we first broke last week, the battle between bill ackman and j.c. penney making headlines over the weekend. according to the "wall street journal" the board may be looking for ways to remove him from the ranks and the "new york post" reporting that the board is backing ceo mike ullman and i guess that is no real surprise if you read the board's statement last week. >> i am still short. i won't be surprised if this is ackman's way of setting up his exit from the company. i don't know if that will be good or bad. >> i think he already said if he agrees to terms he will dig in. >> he won't get out. >> i know he said he may consider selling his thing. then i think it was also they do what they need to do, maybe he would consider going -- putting more in. that's according to reports. >> i am coming to a conclusion
the only way the company will have positive sales growth is if they're starting from zero and then i am not sure. >> what do you make of the involvement from richard perry now and will other value investors get -- >> 25%. >> that's what they're doing. perry is defending a position. >> between ackman and perry you have 25%. >> imagine you're a consumer. you are reading an article about the woman that bought something she thought was on sale and had a price of $24. she got ripped off. this company is dysfunctional. vendors are cringing. customers, they want a positive experience. macy's isn't standing still. nobody is standing still. they're sucking in the customer base and this company may be terminal. >> in the current state is clearly is demonstrating its ability to be dysfunctional. >> what ceo? >> there are said to be -- >> hold on. >> think about it. >> their short list. >> think about it. come into this company if you are unattached to anything else or already had a great run
somewhere. if it fails, it is not your fault. you didn't create this. if it succeeds -- >> you are going to work every day. >> one of the best known wall street analysts has already written a report talking about the foot locker. >> he was there before. he is good. maybe he won't. even if he comes in, i give you the best ceo in the world. it is not going to help. the consumer who is walking to the stores doesn't care. it is a long way out. and i will give you recovery and the best scenarios of recovery you are still looking at a loss of a dollar two years out. what is that worth? we won't buy macy's ten times. why would i pay an infinite multiple? >> that's great. i think it is a great gig for any ceo to step into, very hard to lose here. they can get paid in stock. that won't be worth much. >> who knows. >> the best and worst places to buy a home using specific data
metrics and our guest breaks down his list and some of the cities may actually surprise you. check it out. still ahead here on the half, tesla one of the hottest stocks the year is taking a hit. there it is down 4%. greenberg will debate the traders next right here on set about where the stock goes from here.
> coming up on power lunch top of the hour as sac lawyers ngts with the government, to find out whether the hedge fund will continue operations, we will discuss whether massive layoffs are in the offering at that controversial company, and we will talk to ron who used to work for steve cohen. hedging your bets in hollywood, joining us is the head of one company that can analyze movie scripts and predict, yes, predict whether they will be a hit or not. and analyzing the analysts, we ask about market pro, whether he agrees with the moves on tesla, krispy kreme and a jam packed show power lunch top of the hour. back to you.
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welcome back to "halftime" report. i'm josh lipton. an important crop report just out from the government looking at supply and demand estimates. the crop for corn in particular not as big as estimated, and that reversing corn price is solidly into the green, lifting stocks like potash and mosaic as it may give them more leeway to raise prices for fertilizers on farmers. those stocks near session highs right now. scott, back to you. >> thank you so much. music to steve weiss' ears, you
own both, potash and mosaic. >> here's the deal on this. i was reading a report this morning that looked at corn going from the peak of about 835 a bushel is where it was to 435. overly pessimistic. i think there's room here so every month you get a report so play at your risk. >> josh brown? >> dupont, a secret agriculture name. the business is half agricultural and going high. they still think it's paint and rubber. i've got to tell you, this chart looks better than monsanto and potash and they are in the right spot of agriculture so that's my play. >> plus you get an activist in the name about to break out over 60, giving you above 3%. nobody wanted any of the chemical names. now they want them. >> i'm embracing ugly, blackberry, potash, mosaic. like the ugly charts. >> i thought you were talking about your shoes. >> thank you for looking at my feet, but no.
>> herb greenberg is here. button up the jc penney thing for us. i know you've been watching how this whole thing sun folding, and you're actually bringing some of warren buffett's wisdom from many years ago into this conversation. how does this all fit? >> from 19939. bill ackman despicable or doing what an investor should do? >> howard schultz using the word despicable. >> buffet's berkshire '93 letter he basically said -- any director receives something he doesn't like should attempt to persuade the other directors to his views. if it doesn't work, he should then feel free to make his views known to the absentee owners and naturally the complaining director can expect vigorous rebuttal from the unpersuaded directors, which is how this is currently playing out. >> interesting how all of that almost has come to fruition. let's go tesla. downgrade today. the stock has ripped all year. we know about that. >> this is the second downgrade in a week. this is the ultimate risk-reward story. that's how you have to look at it, the way an analyst would
look at it, what's your risk and what's your reward? analysts downgrading it talking about risk-reward. they are talk about the probablistic approach. >> we had an analyst on last week, can't remember the firm, upgraded it from like 50 to 160 or something like that. >> here's what the analyst says. the current price captures tesla's evolution into one of the most profitable auto manufacturers with sustained volumes and margin equal to porsche. meaningful upside will require manufacturing in china and all sorts of other stuff and in the end it requires flawless execution and that's what these stories, where you know if everything doesn't go just right, the stock starts to fall, and now today analysts are -- >> that's telling you -- they are betting against elon musk if they are talking about execution and have they given you any reason to bet against them? >> it's execution, elon musk fabulous execution all along. don't want to bet against a guy like elob musk.
historically that leaves tread marks on your back or is the execution the metrics the company uses, toss it hit certain metrics that wall street is looking at, if you hit it once or miss once, boom, it goes down. >> weiss, you still negative or have you come around? >> i think the stock is a bubble. i'm betting against the stock price. i'm not short though. >> today with the stock coming down analysts are looking at certain price levels as important technical levels that obviously they feel the stock could then crash through and that would be perhaps worth. >> herb, thanks. >> sure. see where this one goes. 330%. that's what the stock has done. we come back. final trades. we'll tell you who won the debate as well. [ babies crying ] surprise -- your house was built on an ancient burial ground. [ ghosts moaning ] surprise -- your car needs a new transmission. [ coyote howls ] how about no more surprises? now you can get all the online trading tools you need
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netflix, never touch the 50-day. get back in. >> josh brown? >> vaw for the materials comeback. >> mr. weiss? >> blackberry. here's the way to look at it. no communication while process goes on. risk down maybe a few percent. >> stephanie link? >> emerson electric. >> what that does it for us. more "fast" at 5:00. follow me on twitte twitter @scottwapnercnbc. "halftime" is over. the second half of your trading day begins right now. >> scott, thank you very much. 1700, just a memory for the s&p now trading well below that mark, but is this then a good time to put some extra spare cash into the market? blackberry for sale. who knows really. the board of directors up in waterloo, ontario may be getting very serious now. who would buy blackberry? who might the partners be? we'll ask those questions in 30 seconds, and is florida sinking? days after tiger woods said his $50 million home was on shaky ground, a resortr